A green transition is at the heart of meeting the Paris Agreement goals. Nonetheless, if not managed well, it also runs the risk of increasing social inequality, civil unrest, and less competitive businesses, sectors and markets. Transition pathways have distributional consequences – job losses are likely to occur in certain sectors, regions, and/or communities, particularly where dependence on fossil fuels or carbon-intensive practices are high and where opportunities for economic diversification are limited.
History has shown us that issues of justice, inclusivity, and transparency must be at the heart of transformation. This applies to climate action. You cannot address the climate crisis without addressing equity and fairness. Look no further than the “yellow vest”, or gilets jaunes, protest movement in France as a result of a proposed green tax on diesel and gasoline, or to civil unrest which took place in Chile and Ecuador because of perceived inequalities over the benefits of green transition. Questions of fairness and equity span national borders and can have global ramifications for international cooperation and international financial flows.